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A new flat rate state pension of £144 per week as part of government reforms has been revealed as part of the Queens speech. The Pensions Bill will come in to effect in 2016 and would create a ‘simpler state pension system that encourages saving, and provides more help for those who have spent years caring for children’ the Queen said.

The rate is worth £144 in today’s money and expected to be worth £155 by 2016. To get the new single rate pension will that will replace the current two tiered pension system people with have to contribute up to 35 years’ worth of National Insurance.

The bill also features a change to the age that UK residents can get a state pension, which will rise from 65 to 67 years old between 2026 and 2028. Married couples will no longer be able to claim a married person’s allowance worth £66 per week based on their spouses National Insurance contributions, but the time when people who are unable to work when looking after children or sick relatives will count towards them.

Chris Noon who is a partner at Hymans Robertson welcomes a simpler state pension system but believes that the ‘vast majority’ of workers will end up losing out from the new system. Stating that: ‘The reform has been positioned as a benefit, but in reality it reduces pensions for the vast majority of current employees, including those on minimum wage and part-time workers.’

‘The savings are then used to increase the state pensions of the self-employed and, rightly, the very, very low paid.’

‘A private sector employee earning minimum wage could be worse-off by up to £48-a-week in state pension when they come to retire.’

You remember the lectures that your parents used to give you. We all got them. Don’t do drugs. Don’t drink. It doesn’t matter what the other kids are doing. Just because he is jumping off a bridge doesn’t mean that you should, too. We were told from a very young age that peer pressure was a bad thing. Once we grew up and became adults, we thought we could forget these lessons. We were too old to be a victim of peer pressure, we told ourselves. We were fine.

When it comes to our personal financial health, though, peer pressure may still be causing us all sorts of problems. Trying to keep up with our friends may be causing us more trouble than we may have ever thought.

Here’s an example. Pam has a good friend named Emily. They are the same age and they have many of the same interests. They have many of the same friend and they always end up at the same parties. Pam really admires how Emily dresses. Emily always wears boots and she always looks spectacular. She has four or five pairs of boots and they are all great. Pam likes boots, too, and she often goes shopping for new boots with Emily. But there’s a problem. Pam can’t afford to be buying new boots all the time. She wants to keep up with Emily, but keeping up is making her go broke.

What can we learn from this? Well, by giving in to peer pressure and buying boots she doesn’t really need and can’t really afford she is damaging her personal financial health. Just because Emily can afford to keep buying more boots doesn’t mean that Pam can or should. Maybe Emily makes more than Pam does, or maybe she has investment income or an allowance. Pam is trying to keep up to Emily, but she doesn’t have a chance.

There is something else to consider, too. Just because Emily is buying lots of boots doesn’t mean she can afford them, either. Maybe she is spending herself into debt, spending more than she has. Maybe she is giving in to peer pressure and trying to keep up with someone else, too. She might not be someone you want to pattern yourself after.

This is just one example. Your friends could try to get you to eat out more than you can afford, go to concerts or shows you can’t afford or spend money you don’t have in many ways. You’re an adult now, so it is okay to say no once in a while. You might be missing out on some fun now, but it is not fun at all to run out of money. Take care of yourself first.

Two things that no one wants to be this holiday season: broke and miserable. It can feel like everything is just collapsing upon you, like you can’t even breathe. Sure, you might think about going to that holiday party, but then you’re going to feel out of place because you don’t have any money to bring a food tray. Or you might want to hit that concert with your friends…until you realize that you just don’t have much after paying the bills and paying for food.

This is a story that affects us all, but that doesn’t mean that you have to be miserable. If you don’t have a lot of money for the holiday season, there are a few things that you can do right now to make it better.

First and foremost, you need to make sure that you’re not just going through the motions to make other people happy. If people ask you, sit down and tell them that you are trying to save money for other things, and this holiday season needs to be as low key for you as possible. Some will tell you that you’re missing the holiday spirit, but you’ll know better. You’ll be in a position where other people’s hang-ups really aren’t your problem. You’ll be able to move on without fear, doubt, or worry, which is the best feeling ever.

As long as you’re thinking about the bigger picture, how can you fail? Sure, some people won’t understand you, and that’s part of the process too. You can’t worry about what they’re going to be able to handle. Ask yourself this: are they paying your bills? Are they trying to do anything and everything to make you a happier person? Probably not. This is where you have to get tough and look at your real options, not just what you think should be there. Sometimes it hurts to realize that we don’t have nearly as much money as we would like, but that’s part of life. Some people will have money, others will not. This is a process that’s constantly evolving too. It’s possible to gain a fortune…but it’s equally possible to lose it. How you approach money actually said as lot about you. Do you have to have to be out there spending money in order to feel complete? If so, you might want to change a few things about your life.

There are small things that you can do — most communities will have free events. It doesn’t cost you a thing to get into the holiday spirit. Also, consider volunteering. You get to help people that are far less fortunate than you can imagine, while feeling good at the same time. Volunteers often get small gifts and tokens of appreciation, so don’t discount that. If you volunteer for an event, you will probably get the leftovers after the party is all said and done. It just depends on the event that you sign up for.

Get into the holiday spirit with your heart, not your wallet. You’ll end up far richer than you could ever dream of being!

Overspending is a problem that any of us can find ourselves in at any given time. Whether you’re a blue collar worker or an office clerk, you may struggle to stretch your monthly wage, especially during the current financial climate.

With the cost of living rising and an increase in taxation, coupled with the freezing of many salaries, it’s getting tougher and tougher each month for your wages to see you through the month. What many people end up doing is spending more than they can actually afford.

Whether its overdrafts, loans or credit cards, there are options everywhere for whoever is in a financial struggle. Whilst some people keep a close eye on their outgoings, being strict on what they spend, others are more frivolous when it comes to spending. Generally speaking, overspending occurs amongst any age group, depending on their circumstances. However, there is increasing evidence which is telling us that it’s younger people who are in fact the worst age group for overspending.

Young People

Several reports have indicated that there may well be an impending crisis amongst the population, notably amongst young people. Savings are being dipped into to pay for luxury items that many household don’t want to give up, e.g. a luxury holiday or large Christmases. Overspending here is being offset by the use of savings, however not everyone has savings, especially younger consumers.

39% of 18 – 34 year olds have no savings whatsoever, and 36% of 16 – 24 year olds are finding that they are constantly out of money. The cost of living, the reduction in wages and no savings to fall back on means it’s particularly tough for this age group. So if you earn a modest wage which can’t see you through the month and you have no savings to fall back on, what do you do?

Lending Solutions

As mentioned, overdrafts, loans and credit cards are all potential lending solutions for any young person who is need of financial fix. Some of these solutions are more applicable than others given each person’s individual circumstances.

For example, as a young person you may have spent the majority of your monthly wages on rent, food and bills. Unfortunately, even if you have allocated all of your money for the month, something unexpected can happen, e.g. your bike or car may suddenly need fixing. This can hit you in the pocket and because it’s unexpected you may not be financial prepared to pay.

In this circumstance what would a young person do? Well payday loans are an unrivalled financial solution for any young person needing to take out a small amount of money, which they can pay back on their next payday.

The beauty of payday loans is that anyone can get approved one, provided you’re over the age of 18 and that you’re in full time or part time work earning over £500 per month, which gets paid via direct debit into a valid bank account.

With budgets tight at the moment, it’s hard to get out and about with the family. Well here are our top 5 tips to make the most of our time for less.

Save Money On Top Attractions

A lot of the big stores offer great vouchers and discounts to get you into theme parks across the country such as Thorpe Park, Alton Towers and Legoland. Check out what your clubcard and nector points can get you, by checking out their websites before you travel. Bear in mind that these can take a couple of days to arrive though, so always check in advance.

Free Attractions

If you’re looking for something to do that costs nothing at all, then why not consider all of the free attractions available across the country. Trips such as to museums or galleries can be free of charge a lot of the time and also a bit educational for the kids. The Natural History Museum and the Science Museum are great examples of these and are fun for the kids.

If you’re looking for something further afield than London, then other free museums are the National Museum of Cardiff and the Pitt Rivers Museum in Oxford.

Enjoy Being Outdoors

I know that the weather can be a bit unpredictable in the UK, but if we have a rare day of sunshine then you could make the most of the beautiful countryside. Across the UK there are 15 free National Parks to explore.

Eating Out On A Budget

If you fancy taking the family out for a meal, then you don’t have to break the bank. There are load of apps now which can offer you discounts and vouchers which you can either show to them on your phone or print off before you leave.

Cinema On The Cheap

If the weather isn’t on your side, the cinema could be a great way to take the family out together. However, usually they can be a costly affair, but luckily many big chains offer great deals such as Kids AM at Vue and special screening for kids from Odeon. Check out their websites for more information.

We get a lot of questions about the economy, investing, and personal finance. Most of the questions that we get can be answered in a few short sentences, but some questions take a little more thinking. This is a time of the year where everyone puts out predictions about what will happen in the upcoming year.

However, there’s something important that you need to realize; the predictions shouldn’t matter. Treat them as entertainment. Market predictions are just speculation, but it’s not based on anything solid. You just need to go back to solid investing principles.

First and foremost, do you understand the history of what you’re dealing with? Securities are such that you either know what’s going on with the market, or you really don’t. Trying to just guess is like betting from the gut at a casino while you’re playing poker. Sure, you might get some lucky breaks but there’s going to be a point where you fail miserably. Why? It’s easy — you just don’t have anything else going on in your life. You would love to be able to go out on your own and really do something incredible, but you find yourself falling short of that. As a trader, you might even feel like you’re being judged against what all of the other traders are doing. That’s not a world that you want to occupy if you can help it. It’s better to truly look at everything you want to do as an investor, and then go from there.

For example, some people start promoting automated software this time of year, because they know that investors are thinking about what they want to do with the future. The reality here is that no automated software can replace the power of the human mind. So if you’re looking for push button profits, you really won’t find them. However, if you go back to the principles of technical analysis, of fundamental analysis, and of sentimental considerations as far as the investor mind in general, you will go a lot farther.

We’re trained and literally hard wired to deal with patterns, but that doesn’t mean that we have to give in. We can be stronger than the patterns that we live under.

There’s nothing wrong with thinking about the road ahead, but make sure that you’re being smart. Have you looked over your portfolio? Can you join an investing group that meets regularly to discuss this type of thing? Where do you really want to be a year from now as an investor? As long as you’re considering all of these issues ahead of time, you should be just fine.

Get in the game, review the numbers carefully, and then go from there!

Income drawdown is an alternative to annuities for those between 50 and 75. In the same way as a conventional annuity, any tax free cash entitlement must be taken at outset, as it cannot be deferred until a later date.

However, unlike a conventional annuity you are not buying a guaranteed income for life. Instead you can choose an income between 0% and 120% of the equivalent single person’s annuity. In other words if you were able to buy a single life annuity of £10,000 you can choose an income of between £0 and £12,000 per annum.

The monies in your pension fund remain invested and therefore whether income drawdown proves to be a success will largely depend on how these investments perform.

If investment returns are good you are likely to be able to take an increasing income as the pension fund increases in value, but alternatively if investment returns are poor your income will decrease.

As such income drawdown is only likely to be suitable for those who are prepared to take a more optimistic view of potential investment returns.

What Are The Advantages Of Income Drawdown?

Ability to vary income – income between 0% and 120% of the single life annuity can be drawn and can be varied by the pension holder. Therefore income drawdown can be attractive to those who are unsure what their future income needs will be.

Possibility of higher income – the maximum income available under income drawdown is based on the equivalent single life annuity. Many people would need to build in surviving spouse’s benefits etc to a conventional annuity that would reduce the level of pension available. Under income drawdown this is not a problem because should the pension holder die, there are benefits that are not available with conventional annuities (see death benefits below).

Death benefits – with conventional annuities the fund dies with the policyholder (subject to other benefits that can be bought within these plans such as dependent’s pension and guaranteed periods). Under income drawdown there are three options available after death. Firstly the remaining fund can be paid as a lump sum (subject to a 35% tax charge). Secondly the surviving spouse can continue to use income drawdown. Finally the surviving spouse can convert the remaining fund and buy an annuity. As such income drawdown provides significant benefits that are not available under conventional annuities.

Potential for a rising income – if investment returns are kind and the fund increases by more than the amount being withdrawn and other fund charges, then there is the possibility that the maximum income permitted will increase through time to take into account the higher fund value and the typically higher annuity rates that are available as one gets older.

Ability to defer buying an annuity if annuity rates are low – buying an annuity locks one into the annuity rates that are available on the date of purchase. Using income drawdown can defer this decision, and can be particularly beneficial if you believe that annuity rates will rise in the future.

Annuity rates rise the older one is – annuity rates tend to rise based on age. The logic behind this is that the annuity will be paid for less time if the person purchasing the annuity is 75 rather than 65. This is not quite as straightforward as it would seem because of a factor known as “mortality drag”. At birth life expectancy may be say 75 years. However that does not mean that on our 74th birthday we need to put as much as possible into our last 365 days. This is because the figures are an average, and therefore those reaching 74 can be expected to live significantly past age 75 as many people will already have died prior to that age, therefore creating the average for those who live well past it. In other words, whilst annuity rates will usually increase as one gets older, the increase is not proportionate.

Disadvantages Of Income Drawdown

Investment risk – if the investments chosen under perform, then the amount of continuing income under income drawdown and ultimately when an annuity is purchased will fall.

Annuity rates could fall – thereby meaning that future income taken from income drawdown and ultimately from a conventional annuity will fall, even if the underlying investments have performed well.

Charges – under income drawdown your monies remain invested and therefore incur ongoing fund charges that would not apply under a conventional annuity.

Income drawdown can be a valuable retirement planning tool for the right person. Typically it suits those who are not adverse to investment risk, and who have larger pension funds to be able to absorb the ongoing fund charges.

It is even possible to combine income drawdown with annuities by using part of a pension fund for each purpose.

It can also be a useful tax planning tool in terms of protecting the value of one’s estate for surviving spouse and the next generation.

It is important that the correct investment strategy is utilised in accordance with one’s risk profile and income levels. Ideally short term income needs should be set aside in income producing assets such as cash, gilts and corporate bonds, with the longer term monies in assets such as equities that have the potential to yield higher returns over the medium to long term.

It is highly recommended that expert advice be taken, and a financial adviser would be delighted to assist in producing the right balance for you.

Look, let’s be honest — it’s a given that kids change everything in your household. Your financial life will be changed too. Suddenly, it doesn’t matter as much to you that you don’t have a new pair of shoes. You really want to make sure that your child doesn’t have to go without the basics that they want and need. Besides, who wouldn’t want to see their child feel special because they got a brand new pair of shoes?

There’s no need to feel embarrassed if money is a little tighter than you would like. It’s all about being able to really protect and encourage your children. New shoes tend to make them feel like winners, whereas an older pair of shoes makes them feel like nobody is really thinking about them. That would be the wrong attitude to set for your children, right? Wouldn’t it make a lot more sense to think about their needs from a different point of view? Instead of worrying how you’re going to get the money, you need to think about everything you’re going to spend with the money.

At first glance, you might be confused. We’re basically telling you to act as if you already have the money. How can be we so incredibly bold? How can we make those assumptions? How can we just assume that everything is going to fall into place? The truth is that we have to look at our resources to offer you. We wanted to make you aware of the many fast cash loans available online. You see, you can use these loans for any purpose. You don’t even have to put on your applications that you’re using it in order to buy things for your children. That can just be your concern. Any extra can be used to take your kids out to eat.

Deep down, every child wants to feel protected. When the kids see you stressing about the finances, they start wondering if they’re really safe or not. Why not make sure that they always know that they’re protected, safe, and well by having the money right away?

When you go to apply online, that’s actually the type of satisfaction you can expect to receive. As long as you have steady income and employment coming in, you will not be turned down for a payday loan. All you have to do is make sure that you follow the directions. Sure, it sounds like it’s going to be a lot of work, but is that really the case? Not at all. What you get from the experience is simple: convenience. All you have to do is fill out a short application, and you’ll be given the money that you need. Verification is very fast, and painless. You can even find faxless payday loans for the ultimate in convenience. You could be making your shopping list today and have money in a few short hours.

At the end of the day, we can all agree that there’s virtually nothing that we wouldn’t do for our children. If you are nodding your head vigorously in agreement, then the next step is obvious: turn to fast cash loans to pay for all of those school expenses. Good luck!

The road to a better financial life takes on a different shape for all of us. Some people want to really shine and have a very high end, luxurious life. Others want to be able to just get by without having to turn to loans and advances. The world that we live in is a very tough, twisted place. You have to be willing to do whatever’s necessary to get the job done. And yet, the littlest things might be keeping you out of financial prosperity altogether. You see, the mindset that you have about money plays a heavy role in what type of financial blueprint you’ll be able to achieve. If you have a deep disgust for the wealthy, there’s no way that you’re actually going to become one of them. You can’t be something that you hate. You can’t embrace a whole lifestyle that’s chock full of things that you dislike. You cannot feel like you’re going to be sick every time you see someone with means walking by you. These attitudes play out in how you save and how you spend. If you believe that you can have a comfortable life and you’re positive towards those that do already, you stand a much better chance to get the job done.

Emotional distress also plays a role in it. It could be keeping you out of the type of life that you want because it messes with your mindset and it definitely messes with your worldview. There’s something special about getting things done financially. You feel good when you can provide for your family, but is that all you think you are? Is that all you think that you can be? Is that everything that you think you can achieve? The truth of the matter is that you have to be ready, willing, and able to fight for what you feel is the right course of action to take. Otherwise, you’ll just end up spinning your wheels, which isn’t a good sign anyway. You get to make so many good chances when you really think about it, that it doesn’t make sense to skip over the heavy lifting.

The bottom line is that if you want to have things be different, you have to start being different. Look at your budget — if you have one at this time. And if you don’t have one, now is the perfect time to think about getting a budget. You don’t want to sit there thinking that the road to being financially stable is paved with terrible things all of the time. Continue reading →

These days, it feels like just about everyone is interested in taking from your pension in the form of fees. Thankfully, Government is finally saying that enough is enough. New rules are in place now that ban companies from forcing consultant’s charges on their employees who join automatic-enrollment pension plans.

External companies can indeed still give advice to firms about pensions, but the trouble comes in that employers can pass this cost to the staff. Advocates of financial responsibility in the marketplace have indicated that this can definitely eat into first year savings. Consumers are definitely fighting back in a big way.

One of the new changes is that there is a cap being placed on default funds — the funds where your money is invested unless you choose to put it somewhere else. This is can be quite the rip off, considering that you’re already taking a lot of risk on the marketplace. You get to make sure that you finally get to let your pension account grow. Some people feel that their pension would grow better if they had less fees, and they’re absolutely right.

If you’re going to take advantage of pension plans in the workplace, you really need to watch the market. Don’t just let them dump your money into a default account. Steven Webb, the pensions minister, is rolling out new proposals to try to protect consumers. The truth is that it really needs to be a hybrid approach. You need to watch out for your own interests, and then you also need to have protection in the marketplace from the obvious rip offs. It’s really a give and take type of thing, when you really think about it.

The pension age is increasing to 67 in a few years, which means that savers really need to be aware of all for the fast-paced changes in the marketplace. Now is definitely the time to get things moving forward, so don’t get behind in the news. Good times are ahead for consumers, slowly but surely.